DBS Bank of Singapore is set to introduce over-the-counter (OTC) crypto options trading and structured notes for institutional clients in Q4 2024, as per a statement released on Sept. 17 here.
This strategic move positions DBS as the first Asian-based bank to offer financial products linked to the value of Bitcoin and Ethereum, the top two digital assets based on market capitalization.
These new products will be exclusively available to eligible institutional investors and accredited clients of DBS Private Bank and DBS Treasures Private Client.
New Developments in Crypto
DBS’s latest offerings are an extension of its existing crypto services provided through DBS Digital Exchange (DDEx).
Clients now have more options to interact with digital assets, allowing them to potentially earn a yield on fiat currency or receive the underlying crypto. Additionally, Bitcoin and Ethereum holders at DBS can now hedge against market fluctuations and explore various options strategies to potentially generate returns.
Jacky Tai, head of trading and structuring at DBS Group, emphasized the growing interest in digital assets among professional investors and how these new products enhance the bank’s digital asset offerings.
He stated:
“These financial products expand the bank’s value proposition by providing clients with trusted institutional-grade access to the digital asset ecosystem. Clients now have an additional avenue to gain exposure to the asset class and implement advanced investment strategies to effectively manage their digital asset portfolios.”
For instance, a client concerned about Bitcoin’s price volatility could opt for a put option, enabling them to sell Bitcoin at a predetermined price in the future, even if the market price dips below that threshold.
Surge in Crypto Trading Activity
DBS also noted a significant increase in crypto trading volumes on its digital exchange.
During the initial five months of 2024, trading volume for digital payment tokens on DDEx tripled compared to the same period in 2023. The number of active trading clients rose by 36%, while digital assets under custody saw an 80% uptick.
This growth was attributed to a net inflow of deposits from clients seeking secure, bank-grade platforms for the custody and trading of digital assets.
